Tax reform has been front and center this week on Capitol Hill. As previously noted, the House Ways & Means committee released their tax reform plan at the end of last week and worked the past 4 days on debate and amendments to that bill. Chairman Brady (R-TX) introduced two Managers Amendments for the Republicans which were adopted. In the end, the Ways & Means committee voted to move their final bill out of committee to the full House yesterday afternoon. That final bill calls for the repeal of WOTC effective 01/01/2018. It is expected to be taken up on the House Floor sometime next week.
Regarding WOTC, Rep. Kind (D-WI) introduced an amendment that would have removed the repeal of WOTC. While it was a spirited debate between the two sides and Rep. Tom Reed (R-NY) spoke up in support of WOTC on the Republican side, the amendment was not adopted as was the case for all Democratic amendments that were proposed.
After the House moved their bill forward out of committee, the Senate Finance then released the draft of their version late last night. Should their version ultimately be passed by the full Senate, it differs significantly enough from the House that it will set up what is sure to be a difficult conference to reconcile the differences. A Wall Street Journal article found here illustrates the differences between the House and Senate versions.
Of significance for WOTC is that the Senate bill is silent on the program, meaning their intent for WOTC is to keep it ‘as is’ under current law, which extends the program through 12/31/2019. The Senate Finance committee is scheduled to mark up their tax reform bill next week with the intent of finalizing and passing it out of committee to the full Senate. From there if it is passed by the full Senate, and assuming the House passes their bill next week, it would then go to conference where a final compromised bill would need to be crafted and then again voted on by both the House and Senate. If for any reason the tax reform process stalls or fails, then WOTC will continue in full effect through 2019, as noted under current law.
We’ll watch the debate in the Senate next week and keep you apprised of any developments related to WOTC should they come up. If you have any questions, please feel free to reach out to me through email or phone.
Thanks and have a great weekend!